dApp

A decentralized application, or dApp, is a software application whose backend runs on a decentralized network such as a blockchain rather than a single centralized server. The core idea is to enable trustless and censorship-resistant interactions by using open-source smart contracts and network consensus to govern application logic and state.

A typical dApp consists of a client user interface, a set of smart contracts deployed on a blockchain, and often decentralized storage oracles or off-chain components. Users interact through a web3-enabled wallet or browser that connects to the network, submitting transactions that trigger contract code.

Key characteristics include openness, autonomy, and the use of tokens for access, governance, or economic incentives. Smart contracts encode the application's rules; state changes occur when users submit transactions that are validated by the network. Data may be stored on-chain or in decentralized storage systems, and the platform’s governance can be coordinated through on-chain voting or token-based mechanisms.

Most dApps are built on Ethereum, but other blockchains such as Solana, Cardano, Polkadot, and Tezos host dApps with different performance profiles and programming models. Common use cases include decentralized finance (DeFi), non-fungible token markets and games, decentralized exchanges, lending, insurance, identity, and data marketplaces.

Advantages include resistance to single points of failure and user ownership of assets. Challenges involve security risks from bugs in smart contracts, scalability limits, user experience, and regulatory uncertainty. Upgrades often require on-chain governance or contract migrations due to the immutability of deployed code.